Eq: Large Cap

(New York)

Dividend stocks do not seem like a bad bet right now, so long as they are names with reliable dividends. Interest rate risk seems very minor, and stocks with decent cash flow appear likely to do well as yields stay ultra-low. These value stocks are favored by analysts because they are priced with much less bullish outlooks, meaning they have an additional margin of safety versus growth stocks. Here are the stocks: CenturyLink, Unum (UNM), Westrock (WRK), AT&T, HP, Xerox, Principal Financial, MetLife, and Tyson Foods.


FINSUM: This is a nice mix of stocks that should naturally be un-correlated to one another.

(Chicago)

The early thinking about grocery stocks was that the big surge in demand at the start of the COVID lockdown was just a flash in the pan. However, as earnings and guidance is emerging from companies in the space (like General Mills), it is becoming apparent that demand for groceries because of a heightened preference for home cooking seems likely to stick around for a while.


FINSUM: We agree with the fundamental thesis here. Until we cure COVID, people are going to stay worried about public spaces, including restaurants. The trick to picking stocks is to understand where each company is getting its revenue. For instance, General Mills does a lot of sales through grocery stores so its stock is rising, but Molson Coors does a large share of its sales through bars and restaurants, so its stock is falling.

(New York)

There is one sector that is facing a worrying meltdown as coronavirus rolls on. It isn’t as obvious as you may think—its not retail, or restaurants, or autos. Rather, it is insurance. Insurers are about to be hit with otherworldly losses. The head of Lloyd’s of London says COVID-19 will be the most expensive event in the history of insurance, wiping out previous records set during 9/11 and Hurricane Katrina. The range of payouts coming is enormous, spanning event cancellation to management liability to business interruption. According to Lloyd’s “You’re into tens of billions, if not hundreds of billions of loss that will be discussed over time”.


FINSUM: This might not have been immediately apparent to some. Look out.

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